Silver Lake’s SMART Modular Sells Business to SanDisk

Two years after buying memory and storage company SMART Modular Technologies for $645 million, private-equity firm Silver Lake has sold a portion of the business for $307 million.

Memory giant SanDisk Corp. is buying SMART’s storage business, which makes enterprise solid-state drives, saying it is expanding its offerings for the business community.

The deal will include a cash payment and “certain equity-based incentive awards.”

Silver Lake, through two of its investment vehicles, took SMART Modular private in 2011, closing the deal in August of that year. The private-equity firm used $300 million in debt financing and up to $381 million in equity for the transaction, according to a filing at the time.

Silver Lake separated SMART Storage into an independent entity “to allow the company increased flexibility and to capitalize on the rapidly growing demand from enterprise customers for solid state storage,” they said in a release today.

Silver Lake takes pride in its ability as a technology investor, turning a tidy profit on investments, famously doing so with Skype, which it flipped to Microsoft, respectively. Now the firm is backing the $24.4 billion buyout of Dell Inc., working alongside CEO and founder Michael Dell since last summer and fighting for their deal amid shareholder upheaval.

In the Dell fight, dissident shareholders Carl Icahn and Southeastern Asset Management Inc. have argued Silver Lake and Mr. Dell area setting themselves up for a big profit in the deal.

UPDATE: An earlier version of this post incorrectly said Silver Lake invested in Alltel. It was not among the private-equity firms in that deal.